IDEAS home Printed from
MyIDEAS: Log in (now much improved!) to save this article

Third Way, New Labour, and the Challenges to Economic and Monetary Union Macropolicies

Listed author(s):
  • Philip Arestis
  • Malcolm Sawyer

We have sketched in this paper the theoretical foundations of the 'third way', and suggested that they are rooted in the New Keynesian tradition. Furthermore, we argued that the EMU theoretical foundations are embedded in this theoretical approach. We have examined the policy implications of the EMU, along with its theoretical and institutional dimensions surrounding monetary and fiscal policies. The real challenges to EMU macropolicies lie in their ability to move the euro area to a full employment situation with low inflation. They are actually unsatisfactory to withstand the challenge. We have proposed a number of changes that would include the following elements. First, a revamped EIB to supplement the ECB is vitally necessary. Second, any political constraints on national budget positions should be removed, and national governments set fiscal policy as they deem appropriate. Third, institutional arrangements for the co-ordination of national fiscal policies be strengthened. Fourth, EU institutional arrangements are required for the operation of an EU fiscal policy, and to ensure that monetary authorities do not dominate economic policy making. Fifth, serious co-ordination of monetary and fiscal policies is paramount.

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL:
File Function: PDF-file of article
Download Restriction: no

Article provided by Kammer für Arbeiter und Angestellte für Wien, Abteilung Wirtschaftswissenschaft und Statistik in its journal Wirtschaft und Gesellschaft.

Volume (Year): 28 (2002)
Issue (Month): 1 ()
Pages: 43-58

in new window

Handle: RePEc:clr:wugarc:y:2002v:28i:1p:43
Contact details of provider: Postal:
Prinz Eugen-Strasse 20, A-1040 Wien

Phone: +43 1 50165
Web page:

More information through EDIRC

Order Information: Postal: Kammer für Arbeiter und Angestellte für Wien, Abt. WW-Stat., Prinz Eugen Strasse 20-22, 1040 Wien Austria
Web: Email:

No references listed on IDEAS
You can help add them by filling out this form.

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:clr:wugarc:y:2002v:28i:1p:43. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Sepp Zuckerstaetter)

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.